Yen Continues to Benefit from Risk Aversion

Risk aversion due to euro-zone worries and worse than expected US data led to significant gains for the safe-haven Japanese yen yesterday. The USD/JPY fell as low as 78.86, down over 60 pips for the day, amid fears that the US economic recovery is slowing down. Against the AUD, the yen was able to benefit from poor Australian retail sales data. The AUD/JPY fell over 100 pips, reaching as low as $76.70. Turning to today, traders will want to pay attention to US news, specifically the ADP Non-Farm Payrolls figure at 12:15 GMT. Should the figure come in above the forecasted 145K, the yen could reverse some of its recent gains during the afternoon session. That being said, if the figure comes in below expectations, the JPY could extend its recent bullish trend.

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